Hi All! Been a lurker for a while but love this community and wanted to seek some advice/thoughts on my business and how to grow it or learn from what others may have done in the past. I never expected it to grow the way it has, but thankful and looking to make some smart moves with the business as I go forward.
I own (with my wife) a Dry Rub and BBQ Sauce business based out of Cincinnati, Ohio. We have officially been in business since 2013 and carry a total of 4 products: a sweet or spicy Dry Rub and a sweet or spicy BBQ Sauce. The business makes money three ways currently:
- web/in-person orders
- events/shows where we sell directly to customers
- through stores purchasing our products and reselling at their mark-up
A brief history of the company: in the first year, sales were small but advertising and exposure were virtually nonexistent. In 2014, we participated in events and shows to sell/advertise our product and grew so much we had to find a co-packer for our products by the end of the year. In 2015, we kept growing and doubled our sales from 2014 and started to become "recognized" locally. By the end of '15, we were in 8 area stores. 2016 found us getting a larger co-packer to handle the volume and provide batch numbers, bar codes, etc. on our cases for store requirements. We closed the year out under $40k in sales but landed a total of 14 stores and events 3 out of 4 weekends a month from May-October.
So far for '17 we are trending to beat last years sales numbers (on forecasted event income alone, not including stores, online, or Amazon) and are in a total of 18 stores currently (with ~8 stores in the hopper that seem very interested, many more to approach). We are booked at events almost every weekend April-November this year including some pretty big shows in the Fall through Winter. Our profit margins are pretty good right now I feel, but should see a decline if/when I can get a distributor lined up:
Profit Margins Direct to customers: 57-65% depending on specific product Direct to stores: 40-50% depending on specific product
Why the (long) post? I feel there is more potential in this company than what I am doing. Here are some quick thoughts:
We could easily be doubling up events each weekend around the city if we have the people to do it. Right now, friends and family volunteer their time to help out at the events we are participating in and we pick up food/beer/parking as a thank you. What's a fair/smart way to pay someone to do events on their own (needing at least 2 people per day per event)? Hourly? % of sales? Other?
I'd like to sell merchandise/accessories but I need to speak to my CPA about this in regards to sales tax. We make funny shirts for our helpers, but many customers want them or would like some options to buy as well. Is this worth doing as a new income stream for the business? Any suggestions on a company to go through or approach on this?
I need to find a distributor to take over some of the stores but also to help land larger accounts such as Kroger. I've never worked with a distributor before, so any advice here would be great. What is their typical scope? Average mark-up %? Anything else?
I signed up for a Facebook marketing team in May to get more page presence. I will be dropping this shortly and reading the Facebook Blueprint information here soon to save some money (thanks to all of you). It is very much a family venture as my cousin does all the design work, another family member does the Social Media posting (separate from the marketing above), and all the help we get at events is all of the family and then some friends. We have a website, Facebook, Instagram, and Twitter pages but historically I have focused on Facebook – mostly out of comfort. I'm hoping the new Social Media guru will help us expand on all platforms going forward.
For 2017, we just signed on with Amazon for our Dry Rubs (Sauces are in glass bottles and there have been some rule changes for new products with Amazon – hoping this is resolved in early 2018) and they should be listed in the next 2-4 weeks for Prime customers. We have a few new product ideas kicking around but will most likely hold off till 2018 for those. Merchandise ideas are flying everywhere so I just need to narrow that down and price shop if that seems worth doing.
I'm here looking for advice on current plans but willing to listen to new ideas to generate revenue. This business keeps evolving as needed and has seen some pretty good success in doing so (for a $5-$6 product). Any other feedback/thoughts/advice on the business anyone has would be greatly appreciated. Continuing to grow the business or selling the business (for a reasonable number) are both valid options to me, so no idea is too crazy. Thank you for your time and I hope to be able to contribute more in the future!